IOC -- looks like it could be a monster bounce play from what I'm hearing from some posters at thelion.com. Plus there was Reuters article/interview after hours and It looks there were a lot of false rumors , and possibly hedge funds involved...
CALGARY, Alberta, June 29 (Reuters) - A spokesman for Interoil Corp. (IOL.TO: Quote, Profile , Research), whose shares have dropped by more than half since Tuesday, called the plunge "an overreaction" to drilling results at a highly anticipated well.
Shares of Interoil dropped 21 percent on Friday, extending a slide that has seen the stock shed more than half its value since Tuesday.
Interoil, which explores for oil and gas in Papua New Guinea, fell C$5.39 to C$20.47 on volume of 561,588 shares on the Toronto Stock Exchange. That was more than 12 times the average volume over the past 90 days.
The stock had closed Monday at a record peak of C$47.06.
David Larson, a spokesman for the Houston-based company said on Friday the stock's retreat on concerns about drilling results from a highly anticipated natural gas well, was overdone, given that the company has yet to complete work on the well.
"I believe that, like a lot of things on Wall Street, there's a tendency for things to go too high then fall too low," he said. "I think this is a bit of an overreaction on Interoil given that the well has not been finalized."
At a presentation held on Wednesday, Interoil Chief Executive Phil Mulacek said the shares began dropping the day after a meeting with investors following Interoil's annual meeting on Monday.
That meeting may have also have spawned a rumor that the company was poised to issue shares to raise funds to pay a for liquefied natural gas (LNG) facility it is planning in the South Pacific nation, Mulacek said on a recording of the presentation.
"We're not out here issuing stock," he said. "The meeting was a follow-up to our (annual meeting), not that we are doing a placement. We've heard those rumors as well."
On Wednesday Interoil issued an update on its Elk-2 well in Papua New Guinea being drilled to firm up the size of what it said was a massive natural-gas find last year.
The Elk-1 find was said to contain trillions of cubic feet of gas, enough to backstop an LNG facility.
Interoil said Elk-2, about 5 km (3 miles) northwest of the Elk-1 well, has produced some gas, but the company did not detail the quantity that flowed to the surface.
The firm said in its statement that the drilling so far does not confirm a commercial discovery and more definitive results will be available when drilling reaches the planned total depth of 10,000 feet.
Media reports earlier this week said regulators were considering launching an investigation into the trading of Interoil shares following Tuesday's 27 percent fall, given the company didn't issue a press release to explain the drop.
However, Larson said he has not been officially notified of any investigation into the stock trading.
Regulators "haven't officially contacted me," he said. "I had been in contact with them on Tuesday and Wednesday. They were thinking about having their stock watch group take a look... We would appreciate something like that and fully cooperate."
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posted
You read my mind Ace. I have been debating this whole weekend whether or not to take a big position on this for Monday.
It bounced back a little in after hours Friday.
It dropping so hard in the last week of the quarter can't be coincidental with the fund managers dumping the underperformers and picking up performing stocks to make themselves look good for the upcoming quarter.
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posted
I also think JSDA , ENCY , and HSOA could be ready to change directions soon. I think ENCY recently hit like a 4-5 year low!
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InterOil Announces Extension of Preferential Interest Rate on Credit Facility
Sunday July 1, 6:30 pm ET
TORONTO, ONTARIO--(MARKET WIRE)--Jul 1, 2007 -- InterOil Corporation (Toronto:IOL.TO - News) (AMEX:IOC - News) (POMSoX:IOC) today announced that its $130 million secured credit facility with lenders Merrill Lynch Capital Corporation (Merrill) and Clarion Finanz AG acting through an affiliate, Pacific LNG Operations Ltd (Pacific LNG) was amended to extend the existing 4% interest rate from June 30, 2007 to July 31, 2007. With execution of a shareholder agreement covering the Papua New Guinea liquid natural gas (LNG) project by the company and these lenders on or before July 31, 2007, the interest rate will continue to be 4% for the full term of the loan, which ends May 2008. If an agreement is not finalized, the interest rate will increase to 10% unless the lower rate is further extended by the parties.
"We have made major progress on the negotiations covering the LNG project and are close to finalizing the documentation on a definitive shareholder agreement," InterOil Chairman and CEO Phil Mulacek said. "Both Merrill Lynch and Pacific LNG have reiterated their commitment to the LNG project, following the confirmation of a large gas column in the Elk structure. All parties are encouraged with the interim results of Elk-2, and the overall resource potential in the structure, which can underpin the joint LNG project."
Drilling and evaluation operations continue on Elk-2 with several important outcomes already achieved:
- Drilled to nearly 8,700 feet (2,650 meters) and confirmed over 3,400 feet (1,040 meters) of total limestone formation from the top of Elk-1 to the current depth of Elk-2.
- Confirmed that the natural gas column in the structure extends to over 2,300 feet (700 meters) while not encountering a gas water contact.
- Gas was produced to surface and downhole pressures were recorded leading to a calculated reservoir pressure in excess of 3,800 pounds per square inch.
- Heavy gas and gas liquid compositions were reported on mudlogs data indicating that the natural gas is becoming richer with depth, information critical to the design features of the LNG plant.
"These well results strengthen our ability to secure the natural gas supply to support and maintain the project on track for delivery of LNG in 2012. We are positive about the progress of Elk-2 and continue with our plans to drill, core and test the entire limestone formation, which may demonstrate expanded natural gas resources for future growth of the LNG project," Mulacek said.
COMPANY DESCRIPTION
InterOil Corporation is developing a vertically integrated energy business whose primary focus is Papua New Guinea and the surrounding region. InterOil's assets consist of petroleum licenses covering about 9 million acres, an oil refinery, and retail and commercial distribution facilities, all located in Papua New Guinea. During 2006, the company announced a gas and condensate discovery, completed an optimization program at the refinery, and doubled the downstream business by acquiring Shell's distribution assets in Papua New Guinea. In addition, InterOil initiated development activity related to a liquefied natural gas (LNG) project.
CAUTIONARY STATEMENTS
This news release contains projections and other forward-looking statements within the meaning of United States and Canadian securities laws. These projections and statements reflect the company's current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that these projections will be achieved and actual results could differ materially from those projected as a result of certain factors. Some of the factors which could affect our future results and could cause results to differ materially from those expressed in our forward-looking statements include: the ability of our refinery to operate at full capacity and to operate profitability; the success of our exploration activities; political, legal and economic risks related to our operations in Papua New Guinea; our ability to market refinery output; our dependence on exclusive relationships with our suppliers and customers; our ability to obtain necessary licenses; our ability to renew our petroleum licenses with the Papua New Guinea government; adverse weather, explosions, fires, natural disasters and other operating hazards, some of which may not be insured; the impact of competition; the enforceability of legal rights; the volatility of prices for crude oil and the volatility of the difference between our purchase price of oil feedstock and the sales price of our refined products; the uncertainty of our ability to attract capital; uninsured operations; covenants in our financing and other agreements that may limit our ability to engage in business activities, raise additional financing or respond to changes in markets or competition; and the risk factors discussed in our filings with the Securities and Exchange Commission, including but not limited to those in our Annual Report for the year ended December 31, 2006 on Form 40-F.
Any forward-looking statement speaks only as of the date on which such statement is made and the company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise.
InterOil currently has no reserves as defined in Canadian National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). Any information contained herein regarding resources are references to undiscovered resources under NI 51-101, whether stated or not.
Contact: Contacts: InterOil Corporation North America David Larson (281) 292-1800 Email: david.larson*interoil.com
Toothpick, its all in personal taste. Some say they are holding for $40. I personally look for gains around 20%, so when it gets around 28, if its not still moving up good ill look for an exit.
All personal preference.
Posts: 869 | From: Az | Registered: Sep 2006
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posted
thanks for the advice tim, i understand your point of view.
Alot of the better investors are on this one so i thought i'll see at what price they'll pull out at rather than a the % that i like to pull out at normally.
good luck mate Posts: 202 | From: Hong Kong/Birmingham | Registered: Jun 2007
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posted
My opinion is this stock will see $40 again. Whether it be next week or in 6 months I don't know. If I had more free cash I'd be loading up big.
-------------------- Disclaimer: Not accountable for anything I say Posts: 6266 | Registered: Jun 2004
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posted
Some folks on the google finance board are calling this a "boom or bust" play. If they actually find oil in the ELK2 well, it should go to $60 pps overnight. If not, a lot of shorts are calling it around $8-10 since they are out of money and are far from being profitable.
Makes me nervous...
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quote:Originally posted by jon clogger: Some folks on the google finance board are calling this a "boom or bust" play. If they actually find oil in the ELK2 well, it should go to $60 pps overnight. If not, a lot of shorts are calling it around $8-10 since they are out of money and are far from being profitable.
Makes me nervous...
$8-$10 wont happen...watch
-------------------- Disclaimer: Not accountable for anything I say Posts: 6266 | Registered: Jun 2004
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quote:Originally posted by jon clogger: Some folks on the google finance board are calling this a "boom or bust" play. If they actually find oil in the ELK2 well, it should go to $60 pps overnight. If not, a lot of shorts are calling it around $8-10 since they are out of money and are far from being profitable.
Makes me nervous...
Someone correct me here, but i thought they were drilling for gas not oil?
Sounds like a stock lemon comment from Andrew Left.
posted
You bring up a good point TimW. I'm hoping those people are full of it. Got a lot riding on this.
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posted
IMO this looks like they shorted it bad because they hoped they failed to meet the deadline on the loan to keep the 4%... not so much the discovery of gas/oil.. not yet anyways.
Extension of that 4% on the loan should show strength in the operations and/or progress.
Just so happens to be around the same time they provided an update on "no significant" findings in the well yet which hasnt even hit target depth.. PR's confirm all of this.
Shorters shorted in anticipation of that loan being bumped to 10% to drop investor confidence and the exact opposite happened.
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